Fraud accused Qld principal denied bail

A principal accused of inventing students to get cash for Australia's top indigenous college is behind bars after allegedly contacting witnesses in the case.

Jean Illingworth, former principal of Djarragun College near Cairns, was charged with fraud in January for allegedly providing incorrect enrolment numbers to obtain up to $9 million in taxpayer funding.

The 66-year-old was arrested on Wednesday for allegedly breaching her bail conditions and attempting to pervert the course of justice.

Police allege she asked a friend to deliver a false statutory declaration to a witness - a former teacher at the school - for them to sign.

Illingworth, who is banned from contacting witnesses, is also accused of meeting with another witness.

During a bail application in Cairns Magistrates Court on Thursday afternoon, Crown Prosecutor Peter Austen argued bail be refused as Illingworth had put the case in jeopardy.

"The seriousness [of the fraud charges against her] can't be understated," he said.